Elon Musk is willing to pull his $97.4 billion bid for the nonprofit that oversees OpenAI if its directors agree to stop the transformation of the ChatGPT maker to a for-profit enterprise, escalating his long-running feud with OpenAI CEO Sam Altman.
“If [the] OpenAI board is prepared to preserve the charity’s mission and stipulate to take the ‘for sale’ sign off its assets by halting its conversion, Musk will withdraw the bid,” lawyers for Musk said in a court document Wednesday.
Musk’s lawyers said in their filing that Altman breached his responsibility to OpenAI’s charitable nonprofit by single-handedly turning down the takeover bid from a Musk-led investor group before OpenAI’s board had reviewed it. The unsolicited bid was first reported by the Wall Street Journal.
Musk and Altman originally co-founded OpenAI in 2015 as a nonprofit company, but Musk separated himself from the AI firm over disagreements regarding how to move forward with the venture and eventually started a competing AI company called xAI.
Altman is currently seeking to turn OpenAI into a for-profit business, which Musk is suing to prevent. The case centers around Musk’s initial $45 million donation to fund the startup, which he claims was contingent on OpenAI remaining a nonprofit organization.
At $97 billion, Musk’s current offer would fall significantly below the current valuation for OpenAI’s assets. Japanese conglomerate SoftBank plans a new investment of $40 billion, which would place OpenAI’s value at anywhere from $260 billion to $300 billion, according to various media reports.
Altman made his rejection public Monday in a post on X, the social media platform formerly known as Twitter that Musk purchased for $44 billion in 2022.
Altman wrote: “no thank you but we will buy twitter for $9.74 billion if you want.”
Musk responded on X minutes later, calling Altman a “swindler.”
Musk’s lawyers said in their filing Wednesday that “Altman, who plans to have significant equity in the corporation presently planned to result from OpenAI’s ‘conversion,’ rejected the offer unilaterally, on behalf of the Board, before the Board had even seen the proposal.”
They characterized Altman’s rejection as a breach of his fiduciary duty to the charity that illustrates Altman’s “adverse domination of the Board.”
Reuters reported on Wednesday that OpenAI said it had not yet received a formal bid from the Musk-led investor group but that the group had sent the offer to OpenAI’s outside lawyers.
OpenAI said in a separate court document Wednesday that Musk’s bid for OpenAI contradicts his claim in his current lawsuit that OpenAI’s assets should not be used for profitable gain.
“Musk’s purported takeover bid cannot be reconciled with the charitable trust claim his is advancing in this court,” it said.
Neither Musk nor OpenAI responded to emails requesting comment.
A California federal district judge last week made it clear that their courtroom fight over the future of OpenAI could last well into 2027.
That’s likely how long it will take for the dispute between the onetime collaborators to go to a jury trial — which Oakland federal district Judge Gonzalez Rogers said was where the case was headed.
Elon Musk, left, and Sam Altman, middle, talk with New York Times financial columnist Andrew Ross Sorkin in 2015 in San Francisco. (Photo by Mike Windle/Getty Images for Vanity Fair) ·Mike Windle via Getty Images
In the meantime, their enmity has been flaring into the open with increasing regularity.
One such incident came last month during President Donald Trump’s first week in the Oval Office when Trump announced a joint venture called Stargate that would invest up to $500 billion in AI infrastructure via a partnership between OpenAI, Oracle (ORCL), and SoftBank (SFTBY).
Musk criticized the effort hours after it was unveiled, saying on X, “They don’t actually have the money.”
Altman responded on X by saying Musk was “wrong, as you surely know” and invited Musk to visit an AI development site in Texas.
“This is great for the country. i realize what is great for the country isn’t always what’s optimal for your companies, but in your new role i hope you’ll mostly put [America] first,” Altman wrote, attaching an American flag emoji.
Earlier this week, Altman told Bloomberg during a television interview that “Elon tries all sorts of things for a long time. This is the latest — you know, this week’s episode,” referring to his bid to buy OpenAI.
“I think he’s probably just trying to slow us down.”
Referring to Musk’s interest in a rival AI company, xAI, Altman added: “I wish he would just compete by building a better product, but I think there’s been a lot of tactics. Many, many lawsuits, all sorts of other crazy stuff, now this. And we’ll try to just put our head down and keep working.”
On Thursday Musk offered up some new commentary of his own. He said during a video call appearance at the World Governments Summit in Dubai that OpenAI is trying to “completely delete the nonprofit.”
“That seems to be really going too far.”
Alexis Keenan is a legal reporter for Yahoo Finance. Follow Alexis on X @alexiskweed.
Click here for the latest technology news that will impact the stock market
Read the latest financial and business news from Yahoo Finance
